Activity Statements explained
EPISODE 78
Notes
It’s that time of year, and as we at Straight Up Bookkeeping deep dive into completing business and instalment activity statements for the quarter, I’m reminded that the term activity statement can baffle a lot of people.
So today, I’m bringing you a short and sharp explainer episode on what activity statements are, what they include, when they are due and how to lodge them.
Used by the Australian Taxation Office to report various tax obligations, an activity statement details your business activity for the period in question and declares the amount of tax you owe (or any refunds that the ATO owes you). If you are a small business owner, it’s important that you have a good understanding of what your specific obligations are and how to complete these statements correctly. This will help you to avoid penalties and ensure that you are meeting your tax obligations.
I explain the two types of activity statements you should know about:
Business activity statement (BAS)
Instalment activity statement (IAS)
There are two methods for submitting BAS and IAS statements and paying tax. I explain what they are and how the method you use will depend on factors specific to your business. I take you through the different components that determine what your obligations will be, such as:
An individual’s or company’s GST registration status
Sole trader PAYG withholding obligations
Yearly turnover
The ATO strongly encourages taxpayers to lodge their activity statement on time, even if payment is not immediately possible. Lodging on time not only provides clarity regarding your position with the ATO but also demonstrates your awareness and intent to meet your obligations. Failing to lodge on time may lead to penalties, adding an extra motivator to comply.
I hope you find some valuable insights from this episode so that when you next have an activity statement in front of you, you’ll have much more clarity and confidence to complete it.
If you’re in the middle of managing your activity statements right now, good luck! And to all the bookkeepers and tax agents out there - all the best over the next month I’ll see you on the other side.
LINKS:
Register your interest in the Bookkeeping it Real Mentoring Program here.
Check out my course Bookkeeping it Real here!
About the
Author
Bec is a chartered accountant who worked at Australia’s big firms and banks for 15-years. Faced at a crossroads in her career, she backed herself, left her corporate job and launched Straight Up Bookkeeping. 3 years and 5 staff later, Straight Up Bookkeeping is one of Australia’s leading virtual bookkeeping businesses for creatives, with a mission to free business owners from financial stress so they can grow their empires.
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